Posted 7/27/09
CALL FOR PAPERS
WORKSHOP ANNOUNCEMENT
CHALLENGES TO MONETARY POLICY IMPLEMENTATION
BEYOND THE FINANCIAL MARKET TURBULENCE
A workshop sponsored by the European Central Bank
Frankfurt am Main, Germany
30 November-1 December 2009
OVERVIEW:
In the two years of financial market turbulence which
started in the second half of 2007, the ability of the
short-term interbank market to redistribute liquidity
throughout the financial system was seriously hampered. The
disruptions in the money market led central banks to become
a major financial intermediary. This situation raises a
number of challenges for the implementation of monetary
policy and for the economy at large. The malfunctioning of
the money market affected the transmission mechanism of
monetary policy and led the ECB and other major central
banks to rely on non-standard monetary policy measures to
enforce their policy stance. This workshop aims at
discussing how, why and to what extent the money market was
affected by the financial turbulence and at assessing how
and to what extent the non-standard measures had the
intended effects while checking for a possible interference
with market functioning. The workshop would also aim at
drawing lessons about the resilience of existing
operational procedures and about the optimal design of
operational frameworks.
TOPICS:
1. Modelling the impact of the financial market turbulence
on credit and money markets:
a. Modelling the money market yield curve and spreads:
Liquidity risk and credit risk premia; impact of
liquidity policies on the yield curve.
b. The role of asymmetric information in the interbank
market.
c. The relationship between money market rates and rates
on bank lending to non-financial institutions.
2. Lessons for the design of operational frameworks. For
example:
a. Reserve requirements: Compulsory or voluntary? What
is the role of averaging? Reserve band or exact
fulfillment?
b. Refinancing by central banks: Outright purchases
versus repo operations; short-term versus longer-term
repo operations.
c. The optimal level of aggregate liquidity deficit.
d. What is impact of central banks' collateral
frameworks on market incentives and functioning?
PAPER SUBMISSION PROCEDURE/FURTHER INFORMATION:
The deadline for the submission of papers is 18 September
2009. To submit a paper, please send a PDF file to the
conference organisers no later than the deadline. The
organisers commit to select the papers and announce the
final programme by 30 October 2009.
For further information please contact the conference
organizers:
CONTACT: Nuno Cassola
Email: MAILTO:nuno.cassola@ecb.int
CONTACT: Cornelia Holthausen
Email: MAILTO:cornelia.holthausen@ecb.int
CONTACT: Stefano Nardelli
Email: MAILTO:stefano.nardelli@ecb.int